Prominent shipmanagers have highlighted security as one of the top industry challenges this year and are calling on charterers and governments to shoulder more responsibility for vessels trading in high-risk areas.
The past month has seen a string of piracy attacks in the Gulf of Guinea, including incidents that led to the death of a ship master and four Nigerian navy personnel, as well as kidnappings of dozens of seafarers.
“The biggest challenge we’ll face this year is security problems,” Fleet Management managing director Kishore Rajvanshy told TradeWinds.
“This is going to be the biggest threat to shipmanagement firms.”
As Nigeria does not allow private armed guards onboard merchant ships, operators have had to turn to the Nigerian Navy or patrol boats with personnel from the navy or private security firms.
Cost for protection
Such precautionary measures are often required when vessels are within 200 nautical miles (370 km) off the coast. The escort can often last for a day and cost between $50,000 and $80,000, based on industry estimates.
“This is the kind of tricky situation that we're faced with,” Wallem chief executive Frank Coles said. “The cost can be prohibitive.”
With general charter terms often not specifying who would be liable for the additional cost, shipowners occasionally would need to foot the bill.
“We have charterers who refuse to pay… the owners are facing the problem,” Coles said.
Recognising the same issue, Rajvanshy said charterers and shipowners sometimes would need to negotiate over the security cost.
But he added: “Most charterers understand the situation. They are quite sympathetic.”
Both executives reckon better efforts from local authorities are needed to enhance maritime security in the region.
“Local governments are trying to rely on their own navies and restricting the way that other security companies can provide security. This is creating problems in providing better security,” Coles said.
“If they can't control the situation, [they] should be much more flexible in the security arrangements in the waters.“
Crew safety
Moreover, seafarers may refuse to sail to high-risk areas, depending on collective bargaining agreements under each flag state.
“Once or twice, we have had to change crews,” Rajvanshy said.
Coles pointed out this would lead to extra costs for shipowners.
“We do have situations where some of our crew are expressing reluctance… to relieve the crew would cost around $70,000,” he said. “There's a significant cost issue here… you have to balance the cost and the risk.”
Maritime risks have also been heightened by pirates in South East Asia and the Gulf of Aden, as well as geopolitical tension in the Strait of Hormuz.
Although Iran has promised foreign shipowners that no overseas naval escorts are needed in its waters, Rajvanshy suggested arresting vessels can be a tool for Tehran to threaten the US and its allies without engaging in outright warfare.
The situation would be especially thorny for shipmanagers, as merchant ships, even with private guards, would not be able to resist an arrest by national authorities.
“I don’t know what to do,” Rajvanshy admitted.
